SEC Accuses Ex-Franklin Bank Heads Of Home Loan Scam

Law360, New York (April 6, 2012, 2:44 PM EDT) -- The U.S. Securities and Exchange Commission on Friday said two former top executives of a failed Texas community bank concealed the bank's collapsing loan portfolio during the last stages of the housing bubble in an effort to hide its faltering finances.

According to the complaint filed in federal district court in Houston, Anthony J. Nocella, the former CEO of Franklin Bank Corp., and J. Russell McCann, the bank's former chief financial officer, forced the bank to engage in aggressive loan modifications that did not conform with...